By Jimoh Balogun, Ado Ekiti
President Bola Tinubu has pledged to end Nigeria’s over-reliance on borrowing to finance public expenditure like previous regimes.
He made the vow at the inauguration of the presidential committee on fiscal policy and tax reforms held at the presidential Villa, Abuja.
The President said the committee was in line with his promise to remove all barriers impeding business growth in Nigeria.
He said the country could not continue to tax poverty or production, adding that, focus should be on returns, income and consumption.
“The consequences of the ongoing failure of our tax regime are real and significant. The inability of the government to efficiently raise revenue has led directly to an over-reliance on borrowing to finance public spending.
“A government that cannot properly fund itself will also lack the flexibility or fiscal scope to sensibly manage the economy or respond to external shocks.
“Instead, debt service begins to consume an ever greater portion of the government’s already meagre revenues.
“This traps the economy in a vicious cycle of borrowing simply to service previous debt and leaves almost no scope for socio-economic development.
“As President, I am determined to end this cycle. On the day of my inauguration, I promised that my administration would address all of the issues impeding investment and economic growth in Nigeria.
‘’This promise is why I saw an end to fuel subsidy. It is the reason the Central Bank has called an end to its multiple exchange rate system under my watch.
“It is for the same reason we gather here today to inaugurate the Presidential Committee on Fiscal Policy and Tax Reforms.
“Within the scope of its mandate, the committee shall have as its objective the advancement of viable and cost-effective solutions to issues such as the multiplicity of revenue collection agencies, the high cost of revenue administration and the excessive burden of compliance on ordinary taxpayers.”
Speaking further, Tinubu said that the committee would look at ” the lack of effective coordination between fiscal and other economic policies within and across levels of government and poor accountability in the utilisation of tax revenues.
“The committee comprises experts from both the private and the public sectors. I have given them a strong mandate and I expect their report to cover tax reform, fiscal policy design and coordination, harmonisation of taxes and revenue administration, among other items.
“Our target is to improve Nigeria’s revenue profile while making the business environment more conducive and internationally competitive.
‘’Our aim is to transform the tax system to support sustainable development, while, at the same time, achieving a minimum of 18% Tax-to-GDP ratio within the next three years.
“In order to ensure seamless implementation, the committee shall be empowered, not merely to make recommendations but also to provide practical support to the government in the execution and delivery of the recommended changes.
“The committee is expected to achieve its mandate within a period of one year. They are, in the first instance, expected to deliver a schedule of quick reforms which can be implemented within thirty days.
‘’Critical reform measures should be recommended within six months and full implementation will take place within one calendar year.”
Tinubu also directed all government agencies, ministries and departments, MDAs, to cooperate fully with the committee towards achieving its mandate.
In his remarks, chairman of the committee, Taiwo Oyedele, said those who evade tax get away with little or no consequences, adding that there was a need for a change, saying Nigerians are willing to pay tax if they are sure of what it would translate to.’
